Oracle PeopleSoft HCM Product Update, 2012

Key Findings

• Oracle PeopleSoft Human Capital Management (HCM) remains a viable choice for a comprehensive HCM solution with flexible deployment options, especially for enterprises with Oracle applications.
• Despite the Feature Pack strategy, Oracle PeopleSoft HCM has lacked the pace of innovation of specialist talent management software as a service (SaaS)-based vendors.

Recommendations

• Oracle PeopleSoft HCM clients who are looking to upgrade or coexist with Oracle Fusion HCM and Taleo Enterprise Edition functionality should ensure they have Oracle's latest product road maps.
• Evaluate Oracle Validated Integration for Oracle PeopleSoft HCM before embarking on Oracle PeopleSoft HCM customizations.
• Consider Oracle PeopleSoft HCM if your organization needs a comprehensive HCM solution.

Oracle PeopleSoft offers a leading global HCM application that is part of the Oracle PeopleSoft ERP suite. Since being acquired by Oracle in 2005, the PeopleSoft HCM suite has undergone modest innovations and is competitive in the HR management system (HRMS) market. It also has a large installed base. It has functionality for Core HR and payroll, integrated talent management, workforce management and HR Analytics. Oracle PeopleSoft has made significant improvements to talent management, but still lags behind the SaaS-based vendors.

Oracle has a broad HCM offering across Oracle E-Business Suite, Oracle Fusion HCM, JD Edwards Enterprise One HCM, PeopleSoft and now, Taleo (see "The Impact of the Taleo Acquisition on Oracle's HCM Strategy"). Oracle Fusion HCM is also positioned by Oracle as its next-generation HCM offering with both SaaS and on-premises capabilities. Oracle PeopleSoft HCM solutions are well-established and have a large installed base, especially among Oracle PeopleSoft ERP clients. Oracle PeopleSoft has built its ERP customer base from its initial efforts in the HCM solution. It has a strong global footprint with country localization versions. Oracle PeopleSoft HCM Talent Management capabilities continue to improve, although the product lags behind specialist vendors. According to Oracle, the latest version, 9.1, has been widely deployed and there are significant numbers of clients that have upgraded to 9.1. (Gartner estimates more than 60% of overall Oracle PeopleSoft customers have upgraded.)

Oracle introduced the Continuous Delivery concept to deliver more capabilities outside of releases in a less disruptive manner through Feature Packs and delivered as bundles, Maintenance Packs or individual postings. However, the Maintenance Packs are more than just conventional routine fixes and include functionality. This can pose certain testing challenges, because additional regression testing may be required since functionality is being added through Maintenance Packs.

Feature Packs are a roll-up of low-impact (to the customer implementation) product enhancements and maintenance to deliver new functionality more quickly to communicate with customers. They are delivered on an annual basis along with new releases of PeopleTools. The latest version, Oracle PeopleSoft HCM 9.1 Feature Pack 2, has notable improvements in employee self-service (ESS), manager self-service (MSS), compensation management and talent management analytics. Figure 1 provides a snapshot of Oracle PeopleSoft's proposed Feature Pack and Maintenance Pack strategy and current availability.

Source: Oracle

In the last five years, Oracle PeopleSoft HCM has faced intense competition from SaaS vendors for talent management and, more recently, its leadership in HRMS has been challenged by SaaS-based Core HCM vendors, such as Workday and Ultimate Software. Oracle PeopleSoft HCM, like many of its ERP-based competitors, has lagged behind the SaaS competition. The Oracle On Demand (hosting) strategy has had limited success, with an estimated 50 Oracle PeopleSoft On Demand customers worldwide. In addition, Gartner believes that Oracle PeopleSoft HCM is expected to improve its competitive positioning in the SaaS talent management arena by leveraging the recruitment/learning capabilities from the acquisition of Taleo HCM, as well as Oracle Fusion Talent Management.

Oracle PeopleSoft HCM has limited offerings for mobility, but promises to provide better offerings in the next 18 months.

The partner ecosystem for the Oracle PeopleSoft HCM solution/delivery continues to grow stronger. Partners have also successfully deployed bolt-on solutions, upgrade accelerators and prebuilt integration components around PeopleSoft HCM.

Product Strategy

Oracle PeopleSoft has a comprehensive HCM suite that encompasses Core HRMS, such as personnel, benefits and payroll administration, along with ESS and MSS, call center, case management, talent management (including recruiting solutions, performance appraisal/assessment, career development, succession management, learning and compensation management) and workforce management (including labor scheduling, time and attendance, and leave management).

Oracle PeopleSoft HCM 9.1 is widely used for its Core HRMS capabilities. However, the focus will shift to talent management areas.

Oracle PeopleSoft Tools v.8.52, the technology foundation for Oracle PeopleSoft HCM applications, has added some good innovation, such as Web 2.0 functionality. It promises to help Oracle PeopleSoft HCM customers simplify their applications' customization/configuration, and thereby reduce dependency on third-party applications.

The latest release, Oracle PeopleSoft 9.1 Feature Pack 2, includes capabilities such as Forms and Approval Builder, Global Search, Manager Dashboard, Org Chart Viewer, Pivot Grids, Talent Summary and Total Rewards. These capabilities are mostly centered around improving usability through comprehensive employee data views, consolidated dashboards and richer analytical capabilities. However, other HCM vendors are providing similar functionality for improved usability.

Key Oracle PeopleSoft HCM integrations include:

• Oracle PeopleSoft HCM — HR and Time & Labor integration with Clairvia for Healthcare Schedule Talent Management 9.1 to HCM 8.9 Integration for Recruiting Solutions, which provides a complete set of integrations for Oracle PeopleSoft HCM 8.9 and 9.0 customers.
• Integration with Oracle Fusion Talent Management.

Oracle PeopleSoft HCM supports Single Euro Payments Area (SEPA) through the Oracle PeopleSoft Financial Gateway.

Oracle PeopleSoft HCM Enterprise Learning Management 9.1 now supports Sharable Content Object Reference Model (SCORM) 2004, an enterprise learning standard.

Mobility is addressed via various options. Using Oracle PeopleSoft 8.52, Oracle PeopleSoft pages can be accessed via the Safari browser on an iPad. Oracle Business Intelligence applications, including HR Analytics, are also available on an iPad. Beyond these solutions, a slate of mobile solutions is planned for the near future. They will be built natively into Oracle PeopleSoft and accessible via any smartphone or tablet's browser, regardless of device or OS (versus OS and device-dependent applications). The planned mobile solutions that are relevant to HCM include:

• An employee portal: A resource for mobile workers that contains new information, notices and alerts for employees.
• An employee directory: A mobile version of the Oracle PeopleSoft company directory and organization chart.
• Approvals on the Go: A mobile solution for managing workflow approvals, including time sheets, hiring, transferring, promotions and compensation changes.

Oracle PeopleSoft HCM On Demand Standard Edition is the closest to a SaaS deployment option that Oracle has reached with On Demand and PeopleSoft. However, the key thing to note is that customers have limited customization options with this offering. Customers can deploy an Oracle PeopleSoft HCM suite by subscribing to Oracle PeopleSoft HCM On Demand Standard Edition, where Oracle will host and manage the infrastructure, application upgrades and patches, and technology updates. Customers do not have to make upfront investments on the hardware infrastructure, data center, upgrades and customization. Oracle PeopleSoft HCM versions supported in Oracle PeopleSoft HCM On Demand Standard Edition include 8.9, 9.0 and 9.1. PeopleTools' versions supported are 8.47 to 8.50.

Oracle PeopleSoft HCM On Demand Standard Edition supports these modules: HR, Absence Management, Benefits Administration, eCompensation, ePerformance, HRMS Portal Pack, Stock Administration, Employee Self-Service, Payroll for North America, Payroll Interface, Global Payroll (Core only), Pension Administration, Recruiting Solutions, Succession Planning, Time and Labor, and MSS.

The User Productivity Kit (UPK) is a content development, deployment and maintenance platform. It is gaining good traction among end users, available in 22 languages and widely deployed. Customers have reported that the UPK has helped improve the end-user adoption of Oracle PeopleSoft HCM suite.

What to Expect From Oracle PeopleSoft 9.2

Gartner anticipates the launch of Oracle PeopleSoft 9.2 in the next six to 12 months. Gartner believes that organizations can expect continued focus on user experience improvements to ESS and MSS, with additional focus on analytics and mobility. Specifically:

• Complete time management tasks, including Time and Labor WorkCenter that can help organizations prioritize work queues, configurable as a one-stop shop for role-based WorkCenter.
• Intuitive recruitment dashboard for recruiters, recruiting managers and managers; examples of features are recruiter alerts and recruiter metrics.
• Self-Service Paycheck Modeler can be used to hypothetically calculate potential earnings.
• Self-service option for employees to manage their life events with benefits administration.
• Help desk for HR-related ESS with features like a prominent search bar and chat facility with an agent.
• Desktop and absence management integration with an intuitive user interface for requesting and tracking absence.

Continued Investment in Oracle PeopleSoft HCM

Customers can expect new features that are planned to leverage the upcoming PeopleTools capabilities, and thereby assist organizations to further define and streamline their business processes, consolidate the right information for end users, and leverage the latest in Web 2.0 technologies:

• New bidirectional integration with E-Verify and Oracle PeopleSoft HR to electronically verify employment eligibility by comparing Form I-9 information with data maintained by the U.S. Department of Homeland Security (DHS) databases.
• Configurable postmanagement solution to support the complex planning and analyzing needs of managing a military post.
• Simplified, configurable templates to facilitate data entry in Core HR transactions.
• Planned WorkCenters that will increase the productivity of a specific role by streamlining and simplifying their work in a central place. An example of a future HCM WorkCenter is the Time and Labor WorkCenter, which is expected to be a one-stop-shop work space (a single point of entry) to help a manager effectively and efficiently complete his or her time management tasks and move forward with the business flow through payroll.

Strengths

• Oracle PeopleSoft HCM continues to be a very strong global system of record and is poised to be an aggressive player in conjunction with Oracle's cloud strategy.
• It has a large installed base in diverse industries and geographies with country localization versions.
• Global partners and system integrators that provide strong offerings and solutions around Oracle PeopleSoft HCM, which is gaining traction with clients.

Challenges

• Oracle will need to make clear its overall HCM strategy, which includes the diverse and sometimes overlapping functionality of its HCM portfolio. Specifically, Oracle will need to think through how it would prioritize investments in PeopleSoft talent management, given Oracle Fusion Talent Management and Taleo.
• Oracle PeopleSoft HCM solutions are increasingly challenged by SaaS vendors (including Taleo, historically) that provide both Core HRMS and talent management solutions. The combination of Oracle Fusion Talent Management and Taleo helps its competitive position relative to SaaS talent management vendors. However, it does not entirely address the SaaS HCM suite challenge. Customers wanting a full SaaS solution will need to move from PeopleSoft to Oracle Fusion HCM.

Competitive Analysis

Oracle PeopleSoft faces increasing competitive threats, not only in talent management, but also in Core HCM from vendors like Workday and SAP-SuccessFactors. In recent years, stiff competition has come from SaaS vendors such as Cornerstone OnDemand, iCIMS, Halogen Software, Kenexa, Lumesse, Peoplefluent, SilkRoad technology and Ultimate Software. These SaaS vendors are making significant enhancements for addressing key HCM issues and providing comprehensive functionality.

Consider This Product When

• The solution needs to be best-suited for large enterprises and multinationals.

Consider Alternatives When

• The organization needs a pure SaaS-based HCM solution.
• Customers on older releases of Oracle PeopleSoft HCM facing significant upgrade costs should evaluate alternatives (including Oracle Fusion HCM) before deciding whether or not to upgrade.